Prospex Energy PLC El Romeral: Well Workover & Optimisation Contracts (6469N)
01 Octubre 2021 - 1:00AM
UK Regulatory
TIDMPXEN
RNS Number : 6469N
Prospex Energy PLC
01 October 2021
Prospex Energy PLC / Index: AIM / Epic: PXEN / Sector: Oil and
Gas
1 October 2021
Prospex Energy PLC
El Romeral - Well Workover and Optimisation Contracts
Prospex Energy PLC, ('Prospex' or the 'Company') the AIM quoted
investment company (AIM:PXEN) focused on European gas and power
projects, is pleased to announce that its joint venture company
Tarba Energía S.L. ("Tarba") has contracted the well intervention
work and a programme for system optimisation and automation at its
gas to power project at El Romeral in Southern Spain ("El
Romeral").
Upon success, the well workover has the potential to increase
gas production by up to 15,000 cubic metres per day to 27,000 cubic
metres per day and would allow the subsequent start-up of a second
generator to double electrical output. In addition, as described
below, the system optimisation project is expected to boost income
from power generation by up to 65%.
Highlights
-- Contracts committed on 30 September 2021 with Dajan Well
Services S.r.l. for the well workover project.
-- The gross budget of EUR89,000 for the well workover has
increased to EUR103,000 which has been fully approved by Tarba, the
operator of the plant, to cover the costs of extra equipment to
meet HSE commitments.
-- The workover remains on schedule for the week commencing 18 October 2021.
-- Contract also committed with Power Solution Iberia S.A.
("PSI") to automate plant operations to allow continuous operation
of the generators. The work will be executed during the planned
plant shut down in October. The approved budget for the work being
carried out by PSI is EUR71,000.
-- Contract already committed with Reda Oilfield UK Ltd. for the
foaming surfactant chemicals which are necessary to allow removal
of produced formation water from the tubing.
The Company has a 49.9% interest in El Romeral through its
interest in Tarba. The gross budget for the well intervention work
is EUR103,000, comprising EUR79,000 for the well intervention and
EUR24,000 for data acquisition. Tarba has committed to increase the
gross budget for the intervention work by EUR14,000 from EUR65,000
to EUR79,000 to cover the cost of mobilising extra equipment
including a larger flare stack to the well sites in anticipation of
higher flow rates from the well interventions. This extra cost has
been approved to avoid any possibility of having to vent the gas
produced during the testing programme and to ensure that any
produced water and foaming surfactants can be handled safely.
As announced on 22 September 2021, the well intervention work is
planned on one of the suspended wells that is connected by pipeline
to the El Romeral power station. This 'Rio Corbones' well was
shut-in two years after first production in 2014 due to water build
up in the well and has been suspended since then pending a
workover. Produced water had collected across the production
interval preventing gas production and so a low-cost workover has
been designed to lift this water from the well which has
re-pressurised since it was shut in. The workover will involve the
injection of foaming surfactants via the production tubing to
create a low-density foam from the gas and water in the well. This
will reduce the water that has built up in the tubing and allow the
gas to flow to surface.
In addition, a plant optimisation project is underway with PSI
to install systems, equipment and software to allow the safe
automated operation of the power plant 24 hours a day allowing
continuous operation of the generators. This work has been
scheduled during the planned plant shut down in the week commencing
18 October 2021.
Mark Routh Prospex's CEO commented:
"We have supported Tarba in agreeing to the extra costs of this
well workover plan in order to protect the environment and to
ensure that suitable equipment is readily available on site to
ensure the safe and optimum outcome of the well intervention. We
have modelled flow rates from the workover which had the potential
to exceed the safe limits of the flare stack and other equipment
initially proposed. This decision gives this small low-cost
workover plan the maximum chance of success, so that it has the
potential to make a significant impact on Tarba's net income.
"The agreed system upgrade with PSI to automate the plant for
continuous operation has been scheduled during the planned October
plant shut down. This alone could allow an increase of income from
electricity generation by up to 65%, since the generators are
currently shut down overnight and on Sundays.
"Wholesale electricity prices in Spain continue to rise. The
plant sold electricity this month at prices exceeding EUR200/MWh, a
four-fold multiple of the average wholesale electricity price for
the 12 months to May 2021. Gross income for Tarba at El Romeral has
already exceeded EUR194,000 in September and this figure could
double in the coming months after the shutdown following the
planned plant optimisation programme and with a successful outcome
of the well workover."
This announcement contains inside information for the purposes
of Article 7 of the Market Abuse Regulation (EU) 596/2014 as it
forms part of UK domestic law by virtue of the European Union
(Withdrawal) Act 2018 ("MAR") and is disclosed in accordance with
the Company's obligations under Article 17 of MAR.
* * ENDS * *
For further information visit www.prospex.energy or contact the
following:
Mark Routh Prospex Energy PLC Tel: +44 (0) 20 7236
1177
Rory Murphy Strand Hanson Limited Tel: +44 (0) 20 7409
Ritchie Balmer 3494
Colin Rowbury Novum Securities Limited Tel: +44 (0) 20 7399
Jon Belliss 9427
Duncan Vasey Peterhouse Capital Limited Tel: +44 (0) 20 7220
9797
Susie Geliher St Brides Partners Ltd Tel: +44 (0) 20 7236
Catherine Leftley 1177
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